Glossary›Confirmation bias
Confirmation bias
Confirmation bias is the tendency to notice, favor, and remember information that supports a belief already held, while overlooking or downplaying information that contradicts it. In investing, it shows up as reading a 's numbers, news, or ratios selectively once a bullish or bearish view has already formed, rather than weighing the evidence evenhandedly before reaching a conclusion.
It's rarely deliberate, which is exactly what makes it hard to catch in your own analysis. Deciding what evidence actually matters before looking for it, rather than after, is one of the more reliable ways to guard against it.